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No ‘magic wand’ solutions | Claudio Grech

The challenges facing Malta’s economic infrastructure in the long term are too weighty to be solved by tribal politics. Shadow economy minister CLAUDIO GRECH calls for a consensual approach

raphael_vassallo
Raphael Vassallo
15 March 2015, 10:00am
Claudio Grech
Claudio Grech
In a Nationalist Party still struggling to reinvent itself after two years in Opposition, new faces are understandably in high demand.

Claudio Grech might not be the newest kid on the block: he was after all closely associated with former Energy Minister Austin Gatt under the former administration, even if he never had an executive role. 

Still, the shadow economy minister has a significant advantage over many of his colleagues. He cannot be directly associated with any policy or decision attributable to the last Nationalist government; and that makes him something of a trump card in the Opposition’s hand at the moment. 

But he is a card that PN leader Simon Busuttil has so far found difficult to play. Until recently he was the Opposition’s main spokesman for health: a role he took to with visible enthusiasm. Following a shadow reshuffle last January, he was assigned the economy portfolio instead. 

It might be an impression of mine, but he has been significantly less vocal since. I meet Claudio Grech at the ground-floor cafeteria of the Skyparks block near the Luqa airport, and it seems natural to ask him if he was personally disappointed by the reassignment. He did, after all, seem to be enjoying his stint as health shadow minister…

“Health, for me, was something totally new. When Simon Busuttil had spoken to me about it, my response was: health? Why me? I had absolutely no background, no connections. But when I started out, I got very much into the subject. And when you do that, you go into the fundamentals of how a sector works. I started speaking to a lot of different people in the sector, and a lot of patients…”

In so doing, the sheer scope of the challenges facing the sector became evident.

“The three most notable issues are: the fact that we have an elderly population; that the sustainability of our healthcare system – the way it is funded – is going to be challenged time and again, due to a constant decrease in the number of people paying taxes; and thirdly, very importantly, the continuity of care… the notion that when a patient goes to a public hospital or health centre, he will not see a completely different doctor each time. My position was: how can we try, from the Opposition, to make a difference to a sector that has been largely the same over the last few decades? But to answer your question directly: I was happy in health. I sort of evolved to love the sector; to grasp it, to understand it… but then again, the opportunities in the economy portfolio are invariably large. Even from the Opposition, I believe there is a lot we can contribute to the economic growth of our country.”

Sticking to health for the time being. For years now, there have been whispers about the unsustainability of Malta’s healthcare model. Just yesterday, Prime Minister Muscat declared that the service will remain ‘free for all’… which may set off alarm bells, in that he wouldn’t feel the need to say so unless there was serious doubt. 

From his own experience as health shadow minister, does Grech envisage Malta’s healthcare model remaining the same indefinitely?

“First of all, there is a big misconception here. Healthcare is not ‘free’. We all pay for healthcare. We pay taxes, and social security contributions, part of which go towards national health insurance. It is also technically incorrect – and I learnt this in my time as shadow minister – to state that all healthcare services in Malta are free. In fact this is not the case. You realise this when you meet a lot of patients who unfortunately are undergoing oncology treatment. There are a lot of cancer drugs which are exorbitantly expensive, and not covered by the government formulae. I can recall at least 15, 16 cases of families who spoke to me about this situation. Asking someone to pay €1,500 a month for chemotherapy is practically unreachable for most of the population. Let’s be honest.” 

Some drugs, he adds, are even more expensive. “The dilemma that I used to struggle with was: how can our so-called generous healthcare system overlook these people, who are the most in need? I think this is where the debate has to go. This is why I proposed that we should start looking at consensual, convergent politics on healthcare.”

Yet the approach towards health to date has hardly been convergent. One frequent criticism of both parties is that healthcare is often reduced to level of political football. Meanwhile, Grech has moved from health to the economy: which means that he will still have to face the same basic challenge anyway. The ageing population issue affects government revenue as a whole, not just health. And the health service alone eats considerably into the national budget. 

Nor is this the only sector to take a toll on the budget. Energy generation is likewise expensive: we rely on imported fuel, and the bill places an added strain on government finances in a country which relies on electricity for water production too.  

Grech has now joined the chorus of voices demanding explanations over Konrad Mizzi’s apparent involvement in the latest power-purchase agreement with SOCAR. Clearly, there is no convergence in the energy sector, either.

What does Grech himself consider the main problems with government’s energy policy, and – if I might add – is the Nationalist opposition really the most suitably placed to comment on questionable practices in the procurement of fuel by Enemalta?

“The first thing we all need to accept on energy is that there is absolutely no magic wand which will generate cheap electricity. So anyone trying to depict that there is an easy solution – like we were promised before the election: as if there was a magic power station which would solve all problems – I think that is positioning the argument on the wrong footing...”

He also deflects doubts on the PN’s past handling of the same sector.

“In my opinion this government, though it doesn’t admit it, has built significantly on what the PN government had achieved. Why? Firstly, its power generation capacity for this legislature has been built on the back of two infrastructures: the interconnector, and Delimara 2... the so-called ‘BWSC’ power station. These two components are what make up the main power generation capacity of the present government…

But they had no real choice, did they? Marsa was in the process of being decommissioned…

“But the choices were there. And the BWSC plant was such an attractive asset that it was sold lock, stock and barrel to SEP. So today, BWSC is owned by SEP, and Enemalta will now buy electricity generated by Delimara 2 from this company. Now, in my view there is convergence on at least one aspect of this issue: the argument that the future is LNPG. Both parties are aligned to that. Only the method was different. Labour wanted this massive storage vessel in the port, and our argument was that, why not start investing in a pipeline, and in the interim have a vessel outside the port? So when you boil down the arguments, and remove the political statements, in substance we heading in the same direction…”

Grech’s main contention, he goes on, concerns the complete lack of transparency on the Labour government’s part.

“How can we have a debate on energy, how can we say we agree or disagree with something, when the power purchase agreement with SEP has not been published? Today, you and I do not know how much we’re going to pay for the power purchased from the BWSC plant. We don’t know that. What was tabled in parliament was an MOU simply outlining the major points, but there were no details on the financials. For all I know it could be a favourable rate. So why should we speculate, have all these debates, never-ending arguments, finger-pointing and all the rest, simply because the government feels that it shouldn’t disclose the rate it is paying SEP for power?”

Agreed, but the last government was not exactly the most transparent in the universe, either. One quick example: the BWSC contract. When it was negotiated, BWSC retained the right to veto publication. Government even had to ask its permission to release the contract, and some parts of it had been blacked out.

Grech however argues that the parts protected by confidentiality clauses concerned intellectual property rights on the technology used at the plant. Confidentiality does not apply to power purchase agreements.

“Now look at the Electrogas agreement. This is an 18-year supply agreement, and it is twofold: a power purchase contract, so basically we are committed to purchasing energy from this power station that has yet to be built; and secondly, it is an LNG gas purchase agreement. We are contractually bound to buy energy from this company for 18 years, and no one knows at what rate we’re buying it. If government is so confident that it has reached a good deal – a strong, cost-effective and scrutiny-proof deal – can someone explain to me why it is so difficult to get the basic pricing that has been agreed to by the country?”

From his time on the Public Accounts Committee, Grech argues that this trait is becoming habitual with the present government. He had raised similar objections to the Henley contract (to administer the IIP passport scheme). 

“How can the PAC scrutinise an accounting function, when the numbers are not there? The PAC is not there to discuss policy. It’s there to discuss financials. So we get a contract without the financials, and we’re supposed to discuss it. What’s left to discuss?”

He pauses. “I think we need to move away from that. We should be rethinking the way we do politics.”

At the same time, however, this view is becoming a bit cliché. We have often heard similar sentiments before. Lawrence Gonzi had famously talked of a ‘new way of doing politics’, and even before him, Eddie Fenech Adami had forecast a ‘New Spring’. 

In reality, though, the political climate has remained more or less unchanged. Even now, we are gearing up for a local council election, and the messages streaming out of the Nationalist Party these days come across as borderline hysterical accusations of corruption everywhere we look. The Café Premier bail-out, the SOCAR agreement… all are presented to us as examples of decadence and sleaze, by a party that was itself ousted from office after a corruption scandal of its own. 

Yet here we have an Opposition member calling for more consensual politics, when his own party seems to be moving very much in the opposite direction. By Grech’s own argument, the PN must be severely misreading the signs of the times. Does he agree with that assessment?

“Let me tell you my opinion – and I want to be clear that this is my view – I believe that the Opposition has a duty to scrutinise and to point out elements that we believe are not done properly. That is how a modern country has to function. But I feel that, as a party, if we are to make headway we must seize the opportunity of being in opposition. We must clearly show people that we are appreciating the time in opposition. That we’re not bitter about it. Sometimes we give the impression that it’s everybody’s fault but ours. That is a very worrying message, if we were to send it out. Secondly, in Opposition we have a lot of latitude to come up with new policy paradigms. Not just pointing out those areas where government is making a mess. Today, people are already realising that all the talk we heard about meritocracy, transparency has fizzled out. They don’t need to have it constantly spelt out to them. Otherwise there’s a danger that, yes, we might grow to become a formidable Opposition: but we’ll remain in opposition for a very long time.”

Grech however admits that this vision may be hampered by what he calls ‘tribalism’. 

“Something I feel very strongly about is the need to stamp out tribal politics. The way politics has evolved over time, the kind of tribal environment we have in 2015 is still as it was in the 1980s. This is doing a lot of harm to the country. And it will also do a lot of harm to the government. It will bite back.”

This makes it sound as ‘tribalism’ were uniquely coming from the party in government…

“It comes from both. Let me point towards myself instead. When I used to speak about the importance of finding common solutions, you would get some people internally saying: this is not the way we should be doing things; we should be more vociferous, more negative… This is tribalism. And there is a large group of people out there – this is my perception, by the way, I have no statistical evidence for it – that is getting tired of it.”

This raises an automatic question. Looking at the Nationalist Party today, how in tune with is it with what Grech is talking about right now? Is he a lone voice in his call for a paradigm shift? 

“I don’t think so. I also think that even the recent policy alignment of the shadow reshuffle was prompted by a need to respond to this public demand.”

He points out that the new shadow cabinet structure assigns ‘clusters’ of MPs (Grech has two colleagues on his team) to each portfolio. It’s no longer a case of one individual claiming to know everything. “So the party is taking stock of the situation, and revising its structures accordingly.”

All the same, some people within the party may be concerned that there has been too little progress so far. The PN has failed to recover significantly from its 2013 ratings, despite a change in leadership and all the above-mentioned structural reforms. It has also been suggested that part of the reason is that new leadership is too closely associated with the old. We are now on the threshold of another electoral test; and it might not be an exaggeration to describe this as a test of Busuttil’s own leadership.

Does Grech agree, and… does the possibility of a leadership contest interest him personally? Does he see himself as a possible future PN leader?

“Let me start with this: I disagree with those who say the problem is the leadership. We have to understand that we’re coming out of a very difficult period for a political party. We lost an election heavily. It’s no secret that the PN is not accustomed to being in Opposition. Just like Labour wasn’t accustomed in 1987.

"I believe that it is only natural that any party coming out of such a huge defeat, by local standards, would find it difficult to come out it at a fast pace. This was the uphill struggle faced by this leadership team. It’s very easy for someone who is not part of that team to say this, that or the other. But if there is an issue with the PN’s political performance, it is not an issue for the leader alone. It’s a collective issue.

"With regard to my own role: I’m part of the team, and my objective is to do as much as I can so that the Nationalist Party returns to government. So any talk of who’s going to be the next leader, or the one after that… it’s all pointless, because our job is to ensure that the current leader will eventually become prime minister.”